The Canadian stock market officially crossed into bear market territory this week, falling to more than 20% below its April high. We’ve already endured five consecutive months of negative returns and October is so far showing no sign of improvement. It’s times like these that test the mettle of an investor. Do you have the discipline to stick to your long-term plan?

Whenever the markets tank, the very idea of a long-term plan gets called into question. The financial media are filled with stories about “repositioning your portfolio” and “how to invest in times like these.” The implication is that smart investors should react to what has already happened, and then try to predict what’s coming next. Investors who preach “stay the course” are ridiculed as naive fools.

The problem with the whole idea of trying to reposition your portfolio is that it you never know whom to listen to. Nothing illustrates this better than a report today from a UK site called Citywire Money. (Hat tip to De Thomas Financial for sending this along.) Last week, it says, Morgan Stanley polled 200 of its institutional investors and asked them, “What best describes your attitude to global stocks right now?” Here are the results:

  •  20% agreed with the statement: “I am buying now because equities are very cheap and the macro issues are well known.”
  • 30% said: “I expect policymakers to announce credible solutions before year-end and I am waiting for an entry point.”
  • 25% said: “I continue to sell equities as the macro outlook will deteriorate further and policymakers have little or no options left.”
  • 25% said: “I am confused and am doing nothing.”

What conclusion can investors draw from this poll? No matter what course of action you choose, 70% to 80% of institutional money managers will think you’re dead wrong.